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    Question

    Which of the following is

    true?
    A Life insurance contract is a contract of indemnity Correct Answer Incorrect Answer
    B All insurance contracts are contracts of indemnity Correct Answer Incorrect Answer
    C Bonus payable on maturity of policy is called revisionary bonus Correct Answer Incorrect Answer
    D All of the above statements are not true Correct Answer Incorrect Answer
    E All of the above statements are true Correct Answer Incorrect Answer

    Solution

    A contract by which one party promises to save the other from loss caused to him by the conduct of the promisor himself, or by the conduct of any other person, is called a contract of indemnity. Every contract of Insurance, except life assurance, is a contract of indemnity. Reversionary Bonus- Until the bonus is paid, it does not figure in the Revenue Account and is not payable in cash immediately but is to be payable at the time of the claim; it is described as Reversionary Bonus. The amount of Reversionary Bonus is included in claims.

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